By on May 21, 2020

The European Commission is reportedly preparing an economic stimulus package aimed at helping the EU bounce back from economic hardships caused by the coronavirus lockdown — saving some room for incentivized electric vehicle sales.

As you may have noticed in your home country, stimulus package proposals often involve lawmakers attempting to slip something in to aid their favorite causes. While not every nation in the EU feels similarly on all matters, environmentalism has been a reoccurring theme within the union — and has encouraged it to make aggressive decisions when it comes to promoting vehicles.

For decades, the European Union spent billions in subsidies and tax breaks to make diesel fuel cheaper than gasoline. Diesel engines produced less carbon dioxide and opened the door to biofuels, so the presumption was they were better for air pollution. That turned out not to be true, so the continent then pushed hard into subsidizing EVs, with diesel sales crumbling as a result.

Now seen as the only way to save the world from heavy, gas guzzling crossovers that people actually buy in great numbers, battery electric cars are getting their moment in the sun. And it may get a little brighter. The next EU stimulus package is set to include €20 billion ($22 billion USD) for those deciding to purchase an environmentally friendly passenger car.  (Read More…)

By on May 19, 2020

Mexico spent plenty of time discussing the phased reopening of automotive plants last week. The presumption was that the nation would have to establish guidelines for industrial work zones that would allow some to resume production after May 18th, with timing coinciding with U.S. facilities that will be in desperate need of parts and vehicles. However, last minute changes left everyone wildly confused.

On Thursday, the Mexican government said the industrial sector wouldn’t be eligible for reopening until June 1st. The following day, it explained that the date didn’t actually mean much for automotive outfits, adding that companies could reopen at any time if they verified an adherence to new safety protocols. Thanks to another announcement over the weekend, most of the residual confusion has subsidized. Mexican facilities can reopen, provided they have the correct paperwork on file. (Read More…)

By on May 18, 2020

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As predicted, supply issues are hampering the automotive industry’s relaunch. The good news is that practically everyone on the planet understood this would be a problem, but it’s undercut by the preliminary damage created by coronavirus lockdowns.

While automakers had sizable cash reserves with which to endure an economic shutdown, many suppliers did not. Small part suppliers have struggled with liquidity as larger equipment manufacturers try to figure out how to ramp up production and address their own supply headaches. As it turns out, shutting down an entire economic sector is a lot easier than restarting one after it’s been kneecapped. (Read More…)

By on May 13, 2020

Mexico is considering reopening factories after May 18th, now that automakers and the U.S. government have requested it resume production at plants serving the American market. With supply chains needing time to catch up, vehicle assembly will be precarious until parts can be reliably sourced. And Mexico is an essential part of that industrial recovery plan, necessitating some light coordination with the United States.

Despite seeing a spike in new COVID infections, Mexico released a plan to ease restrictions on Wednesday. Making sure U.S. manufacturers have what they need has been incorporated into that strategy, with a few conditions. While industrial employees will soon head back to work, Mexico made no assurances that it will prioritize supplying the rest of North America with automobiles or their components.  (Read More…)

By on May 11, 2020

Spending the last three months chronicling every every single cancellation related to the coronavirus hasn’t been any more enjoyable than reading about it. And, while we apologize for putting you though that, there honestly isn’t much else to report on when every manufacturer on the planet suddenly enters into a panicked lockdown. Thankfully, we seem to be nearing the end of being forced to issue updates on the latest cancelled soirée you had your hopes set on attending.

Despite automotive trade shows being canceled in Detroit, Geneva, and Paris this year, the Specialty Equipment Market Association (SEMA) show scheduled for November is still on. We may also see the New York Auto Show, which was rescheduled, take place in August — assuming the Javits Center remains underutilized for COVID patients through the summer and NYC doesn’t see a sudden spike in infection rates. However, SEMA is the first major event that seems like a sure thing in the automotive realm and, boy, are we glad to hear it.  (Read More…)

By on May 8, 2020

Japan released a list of companies subject to new foreign-ownership rules on Friday, with automakers included in the document. The adjustment influences how outside investment will be handled in regard to business sectors crucial to national security by the nation’s Ministry of Finance.

Foreign outfits buying a stake of 1 percent (or more) in Japanese companies will now face a pre-screening process to ensure they’re not a threat. The old benchmark for such action was set at a substantially higher 10 percent.

While the language used in the document isn’t targeted and largely pertains to additional scrutiny in the general sense, this has everything to do with China. It also mimics measures taken in the United States and Europe to avoid further instances of intellectual property theft (or simply having sensitive information leaked to the Chinese Communist Party). It’s still risky, however, as about a third of Japanese stock is owned by investors from outside its borders. Meanwhile, the nation is hoping to ramp up investment to boost its economy.  (Read More…)

By on May 5, 2020

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Ford Motor Company COO Jim Farley has purchased $1 million of stock in the company he works for as a sign of faith that the Blue Oval can and will recover. You might recall Farley from his recent promotion, one resulting from a March management shakeup that forced Ford’s former head of automotive Joe Hinrichs out of the company. That situation ruffled a few feathers, but it’s ancient history now, considering what landed on Ford’s plate later in the month.

The automaker went into the coronavirus pandemic in the midst of a comprehensive and costly restructuring campaign. Government-mandated lockdowns soon stymied the economy, negatively influencing Ford’s share price. Plenty of automakers find themselves in similar situations, creating an impetus to further walk back mobility claims they were all betting on — or, more accurately, getting Wall Street to bet on.  (Read More…)

By on May 4, 2020

Elon Musk

Tesla CEO Elon Musk has had an interesting few days. It all kicked off when he went off on the politics behind coronavirus lockdowns — suggesting that state mandates had surpassed what should be deemed reasonable and that civil liberties were being infringed upon — during Wednesday’s earnings call. By week’s end, he was using social media to announce Tesla’s stock price was too high.

Despite it not being his first time making such a claim, and with the automaker turning a surprise first-quarter profit, the company’s share price still lost 10 percent in a single day. Musk then announced he would sell practically everything he owned. Initially, it seemed to be another partial joke taken completely literally by some followers and the media. But Musk began making good on the claim, listing two properties over the weekend.  (Read More…)

By on May 1, 2020

The Motor & Equipment Manufacturers Association (MEMA) and Original Equipment Suppliers Association (OESA) have issued a letter to Michigan Governor Gretchen Whitmer saying they’re ready to start delivering components to manufacturers.

Despite Detroit automakers signaling a readiness to resume production, Whitmer has extended stay-at-home orders through May 15th — lifting some earlier restrictions on business and travel. However, the automotive industry still doesn’t have an official date to get things moving again, just a series of business plans outlining a gradual ramping up of production once lockdown mandates end.

Suppliers say that isn’t good enough. They want a clear-cut pathway toward industrial redemption. (Read More…)

By on April 28, 2020

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Rivian and Ford Motor Co. are nixing plans to deliver a jointly developed Lincoln EV. Despite Lincoln President Joy Falotico saying the model would deliver one of the most tranquil and luxurious driving experiences on the planet back in January, Lincoln told dealers on Tuesday that development would be scrapped.

Ford invested $500 million in Rivian last year. The collaborative project was intended to deliver a high-end, battery driven vehicle built on the “skateboard” platform underpinning Rivian’s R1T pickup and R1S SUV. Had the project not been taken behind the shed and shot this week, an assumed mid-size Lincoln crossover would have arrived in 2022.

(Read More…)

By on April 27, 2020

World leaders like to travel in comfort, security, and style — which is why you never see presidential motorcades formed around a Nissan Versa. Instead, security details crowd around something big, black, and closely tied to a domestic nameplate if the nation in question has such a manufacturer. In China, the preferred choice among high-ranking government officials has been FAW Group’s Hongqi luxury brand. Translated into English, the name means “Red Flag” and it’s the pride of China, even though the bulk of FAW’s premium models are a redux of various automotive products produced by foreign manufacturers.

That includes Hongqi’s first vehicle, the CA72. Launched in 1958 as a model exclusive to state institutions and the leadership of the Communist Party of China, the CA72 was basically a 1955 Chrysler sedan with a different grille. While that model line has had its own evolution, subsequent FAW products from the modern era benefited from joint partnerships with automakers like Mazda, General Motors, Toyota, and Audi.

A new joint venture specifically targeting Hongqi is now underway, and its a curious one. An American electric vehicle startup named SilkEV is apparently teaming up with the brand that symbolizes the CCP to produce high-end performance cars, and they’re spending a bundle to do so.  (Read More…)

By on April 27, 2020

Following a nearly six-month search for new leadership, the American Center for Mobility (ACM) has named Reuben Sarkar as its new CEO. The Michigan-based facility has been without a chief executive since Michael Noblett left in November of 2019, leaving COO Mark Chaput in charge while the company hunted for a replacement.

It found one with Sarkar. He’s positioned to assume his new role at the historic site (Willow Run) that manufactured B-24 bombers in World War II before transitioning to GM vehicles and eventually the testing of autonomous cars, in early May. But this isn’t one of those cushy CEO positions where one can sit back and enjoy a sizable annual bonus. Intellectual property conflicts, legal hazards, and a longer-than-presumed development timelines have stagnated the self-driving industry. Mr. Sarkar is going to have his work cut out for him — though we’re sure he’ll still be well paid.  (Read More…)

By on April 21, 2020

Nissan said Tuesday that it plans to temporarily shut down its global headquarters and several factories in Japan to help curtail the spread of the novel coronavirus. While Japanese automakers are legally allowed to operate within the country (with conditions), most have instituted some amount of health countermeasures independently. The nation has also formed a joint council for automakers and component suppliers to work with the government in maintaining supply chains while avoiding future contagion risks.

Despite the level of precautions taken, the country’s automakers are still estimated to lose at least $1.6 billion as the pandemic suppresses demand around the world. Nissan, which issued profit warnings in 2019, went into 2020 expecting to eliminate thousands of positions so it could begin amassing $4.4 billion in savings by 2023. Marketing budgets and product lineups would also need to be rejiggered dramatically to assure profitability moving forward. With the coronavirus further complicating the company’s strategy, May’s idling could be about more than just containing the coronavirus.  (Read More…)

By on April 21, 2020

As the resulting complications of coronavirus lockdowns obliterate the economy, reports have emerged that subprime car buyers are beginning to skip payments. Delinquencies were expected to come up a bit this year, even before local governments started issuing lockdown orders, but the swift economic impact of these health initiatives have proven wider-reaching than anyone anticipated.

Normally, the status of the more volatile subprime market is a useful tool in assessing the financial well-being of the country as a whole — sort of an early warning device for economists. However, getting an accurate read on who stopped paying could be hard during the pandemic. Many lenders are offering deferral programs to keep one or two delinquent payments from turning into full-blown defaults. Still, the initial signs are about what you’d expect, and it plants another economic red flag into American soil.  (Read More…)

By on April 20, 2020

Updated social distancing guidance released by the Department of Homeland Security’s Cybersecurity and Infrastructure Security Agency (CISA) on Friday indicates the automotive industry is now an essential business.

Version 3.0 (for those keeping count) of what constitutes “essential critical infrastructure workers” added a number of job descriptions as the federal government mulls how to restart the U.S. economy. Among them is pretty much every job related to automotive manufacturing and sales. (Read More…)

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